01-22-2009, 12:28 PM
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Hyundai profit falls 8.9% in 4th quarter
TOKYO -- Profit at Hyundai Motor Co. slid 8.9 percent in the fourth quarter, despite help from favorable exchange rates that lifted revenue from exports.
Operating income sank to 581 billion won ($524.8 million) in the three months ended Dec. 31, from $576.3 million a year earlier, the South Korean automaker said today in a release.
Revenue inched ahead 1.1 percent to $7.98 billion in the quarter.
Profits eroded even as the Korean won fell 19.1 percent against the dollar and 25.7 percent against the euro, making Hyundai's overseas earnings more valuable went repatriated.
Exports from South Korea generate nearly two-thirds of Hyundai's sales, and shipments overseas climbed 2.1 percent to 1.1 million vehicles for all of 2008.
Hyundai's results show it faring little better in the global meltdown than its Japanese rivals, despite a favorable won. The Japanese are being hit by tumbling demand and a hostile exchange rate. The yen has climbed against the dollar and the euro, cutting heavily into their profits.
But at Hyundai, the weak won helped boost exports to the United States. Shipments to North America climbed 6.0 percent to 281,000 units in the full year.
Exports to Europe fell 8.4 percent to 318,000 vehicles last year. Hyundai saw a sharp decline in SUV sales there because of high fuel prices.
Global volume fell 1.9 percent to 1.7 million vehicles in 2008, pulled down by a 6.6 percent drop in unit sales during the fourth quarter as the credit crunch worsened.
Hyundai warned that the coming year would present a "major challenge."
In response, Hyundai says it will focus on developing green cars, improving the profitability of small cars and tapping rapidly growing developing markets outside the United States.
For the full year through Dec. 31, operating profit fell 3.5 percent to $1.70 billion, compared with $1.76 billion in 2007.
Global revenue advanced 5.1 percent to 32.91 trillion won.